FBI warns of rising mortgage fraud

8 July 2009

Mortgage fraud in the US is on the increase, a new report from the FBI has warned.

The agency stated that financial institutions lost $1.4 billion in 2008 due to suspicious activity regarding homeowner loans, an 83 per cent increase on the figure recorded in 2007.

And its 2008 Mortgage Fraud Report noted that this figure is likely to rise further in 2009, as the bureau found that reported losses for the first six months of the current fiscal year were $208 million greater than in the same period last year.

The economic downturn, rising foreclosure numbers and falling credit supplies were cited as reasons for the rise, with industry insiders such as brokers, lenders and accountants being responsible in many cases.

In related news, a recent poll by Tonbeller found that money laundering is the greatest risk being fought by financial institutions, followed by terrorist financing, internal fraud and identity theft.

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